ArcelorMittal-Nippon Steel India (AM/NS India) has reported a 467 per cent year-on-year increase in EBITDA (earnings before interest tax depreciation and amortisation) for the April-June quarter of the current year at $607 million, aided by a low base. Strong cash generation and balance sheet strength will continue to support the funding requirements of the long-term growth plans, the company said.
The company has tentatively set 2030 as the target year for reaching the 30 million tonnes per annum (mtpa) capacity.
AM/NS India had acquired Essar Steel’s Hazira plant for Rs 42,785 crore in December 2019 via the insolvency route after a protracted process. This was the country’s largest stressed-asset deal and marked Arcelor-Mittal’s entry into India’s potentially fast-growing steel industry. AM/NS India is a 60:40 joint venture between the world’s largest steelmaker ArcelorMittal and Japan’s Nippon Steel.
The asset since then saw an impressive turn around generating $247 million EBITDA in the first half of last year which grew to $1,010 million in the same period of the current year.
AM/NS India has already started the debottlenecking process to achieve 8.4 mtpa capacity in Hazira. In the medium and long terms, it plans to jack up capacity to 14 mtpa and further to 18 mtpa respectively from around 7.6 mtpa now.
The company is also “progressing well” in Odisha where it plans to set up a 12 mtpa capacity with an investment of `50,000 crore. India-born billionaire Lakshmi Mittal inked an agreement with the Odisha government for setting up the plant in Odisha in March this year. In a statement, issued post-announcing the result for the second quarter, parent ArcelorMittal’s CEO Aditya Mittal said, “AM/NS India’s progress in the 18 months since its inception is an excellent foundation to advance our plans to pursue both organic expansion and strategic opportunities in support of India’s growing economy.”